Wait. What? Hasn’t that always been the case? I thought so, too, until I read that Apple’s fastest growing product isn’t really a product at all. It’s Services; that revenue stream where everything else but iPhone, iPad, Mac, and Watch belong. Don’t worry. Services requires hardware.
Wearables R Us
With the acquisition of Beats music and headphones a few years ago, Apple entered the so-called wearables space. Along came Watch, then AirPods, and perhaps soon, an Apple-branded pair of noise cancelling headphones.
Why headphones? Beats is all about headphones. Apple even changed the name from Beats Music to Apple Music. Is the Beats brand dying? Probably not, but these days everything Apple is about Apple. Apple TV, Apple Watch, Apple Pay, Apple Music, Apple HomePod, and of course, the major sidebar brands– Apple Mac, Apple iPhone, Apple iPad. Even the new headquarters is all about Apple. Apple Park.
Beats headphones, in all their varieties– on ear, over ear, wireless; and the crazy colors that all the kids crave these days– have their detractors; mostly audiophiles with ears my age. So much for audiophiles, right? Our kids have Beats headphones and I tried them. They’re loud. Heavy on bass, too. More so than my pair of Bose noise cancelling cans.
None of that matters much because good brands can stand side-by-side in the same store. AirPods are Apple. Music is Apple Headphones are Beats. That works for me. What can Apple’s own headphones bring to the party that Beats cannot? Choice.
We should not be surprised that Apple makes far more hardware than it did when iPod was launched in 2001. At that point in the space time continuum, Apple and the Mac were synonymous. A few years later and the iPod and iTunes revolution had given Apple a few hundred million customers, growing revenue and profits, and perhaps more hubris.
I know, right? As if Steve Jobs didn’t have enough to go around.
As much as Services grows revenue and and profits at Apple, please not that Services is dependent upon hardware sales, so our favorite Cupertino gadget maker needs to churn out additional hardware. CEO Tim Cook will go down in Apple history as the accessories visionary. He’s not much on where Apple’s future will be in the future, but for now he’s nailed down accessories and each one helps to sell more services.
But Apple is a hardware company.